2006 Ohio Revised Code - 1310.07. (UCC 2A-109) Option to accelerate at will.

§ 1310.07. (UCC 2A-109) Option to accelerate at will.
 

(A)  A term providing that one party or his successor in interest may accelerate payment or performance or require collateral or additional collateral "at will," "when he deems himself insecure," or in words of similar import shall be construed to mean that he has power to do so only if he believes in good faith that the prospect of payment or performance is impaired. 

(B)  With respect to a consumer lease, the burden of establishing good faith under division (A) of this section is on the party who exercised the power. Otherwise, the burden of establishing lack of good faith is on the party against whom the power has been exercised. 
 

HISTORY: 144 v H 693. Eff 11-6-92.
 

Not analogous to former RC § 1310.07 (137 v H 1134; 144 v H 332), renumbered RC § 1315.07 in 144 v H 693, eff 11-6-92.

 

Official Comment

Section 1-208 and Unif. Consumer Credit Code § 5.109(2), 7A U.L.A. 171 (1974). 

1. Subsection (1) reflects modest changes in style to the provisions of the first sentence of Section 1-208. 

2. Subsection (2), however, reflects a significant change in the provisions of the second sentence of Section 1-208 by creating a new rule with respect to a consumer lease. A lease provision allowing acceleration at the will of the lessor or when the lessor deems itself insecure is of critical importance to the lessee. In a consumer lease it is a provision that is not usually agreed to by the parties but is usually mandated by the lessor. Therefore, where its invocation depends not on specific criteria but on the discretion of the lessor, its use should be regulated to prevent abuse. Subsection (1) imposes a duty of good faith upon its exercise. Subsection (2) shifts the burden of establishing good faith to the lessor in the case of a consumer lease, but not otherwise.